SMM December 5:
The most-traded SHFE lead 2601 contract opened at 17,285 yuan/mt today. It edged up with slight fluctuations in early trading, surged to a high of 17,375 yuan/mt before noon, then pulled back slightly toward the session's close, finding support at the five-day moving average. It finally settled at 17,290 yuan/mt, up 105 yuan/mt, or 0.61%, marking a four-day winning streak.
On one hand, maintenance and production halts at primary lead and secondary lead smelters across many regions in China continued in December, keeping social inventories of lead ingots low. As lead prices surged sharply, suppliers showed strong sentiment to hold prices firm. On the other hand, most secondary lead smelters kept their purchase offers for scrap batteries unchanged, with only a few raising them slightly. Due to apparent reluctance to sell among holders of waste lead-acid batteries and the off-season for retirement of lead-acid batteries used in two-wheeled EVs during winter, the volume of recyclable waste lead-acid batteries in the market decreased. This led to reduced raw material arrivals at secondary lead enterprises, further constraining production release. Meanwhile, downstream battery plants remained relatively active in purchasing lead ingots due to year-end stocking demand, providing some support to lead prices. Overall, with short-term bullish factors accumulating, lead prices are expected to continue holding up slightly firm in the near term. However, close attention should still be paid to the impact of environmental protection-related controls and scrap battery supply conditions going forward.
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